Looking at the latest housing supply figures it was encouraging to see that, although the net additional figure may still be below the peak in 2007-08, it was still the second highest in 25 years, and up 15% on last year.
There were of course a few contributing factors to the increase in new build, including government schemes such as help-to-buy and the relaxation in planning regulations. New build has become more popular across the board, not just for first-time-buyers and second steppers, but also for the older generation downsizing. Schemes, such as part exchange, have also made new build more attractive. Part exchange in particular makes the process much quicker and in many cases less stressful and ultimately less expensive.
The government is well aware of the need to build more housing; Teresa May has said she is making it a personal mission to build more homes more quickly and Sajid Javid is determined to ensure we don’t create a ‘rootless generation’. Anything that the government does to increase new building and improve housing supply is good news. However, actions speak louder than words and we will have to wait and see how these promises manifest themselves down the line.
During the Chancellor’s recent budget speech the most shocking statistic was that in London alone there are currently 270,000 homes, with planning permission granted, that have yet to be built. We have to wait another five months for a new report that will, no doubt, tell us that most of this building is being held up by developers and investors waiting to achieve higher prices down the line. When supply is so desperately low, in comparison to demand, this report is a step in the right direction but it’s a shame we have to wait months for it to be commissioned.
There were some encouraging announcements in the budget. Most, including the abolition of stamp duty for first-time-buyers buying properties under £300,000 and extra investment committed to improving construction skills were way overdue, whilst planning reform too has been a long time in coming. However, we have to take heart in the fact that the government is now getting serious about housing.
There is no quick fix, but if the elements of the housing white paper, that have not yet been implemented, all come into force it and Teresa May delivers on her promises the signs are good in the longer term.